Ray Dalio has seen a lot of bubbles during his 50+ years of investing. He defines a bubble by these six things:
- Prices are high relative to traditional measures
- Prices are discounting unsustainable conditions
- New buyers have entered the market
- There is a broad bullish sentiment
- Purchases are beging financed by high leverage
- Buyers and businesses have made extended forward purchases
In this video, Dalio goes through each of these six fields and reveals whether we are heading for another bubble.
